Doug Ashbury
Northern News Services

NNSL (Sep 01/99) - Con mine owner Miramar Mining Corp., in its half-year report, says it will combine its gold processing with reclamation work.

"The new mine plan will see the Con mine site reclaimed concurrent with ongoing operations," the company said Thursday.

The Con mine, brought back into production in July after an 11-month United Steelworkers of America Local 802 strike, is expected to reach an annualized production rate of 100,000 ounces per year.

"While we don't expect to have positive cash flow on this production at the current gold price, operating the mine while reclaiming the site will significantly reduce the overall costs of reclaiming the mine," Miramar president Anthony Walsh said.

In July, the mine produced more than 7,000 ounces of gold at a cash cost of under $240 US an ounce.

On reducing costs, Miramar said it has cut payroll and staffing costs outside mine sites by 33 per cent over 1998 levels and expects to reduce those costs by more than 50 per cent by the end of 1999. The cutting meant significant one-time severance costs but should improve the balance sheet in future, Miramar, in Friday's release, said.

For the six month's ended June 30, Miramar was in the red $.4 million, or 13 cents a share, compared to a $1.5- million loss, three cents a share, in first-half 1998.

The results include Miramar's 54 per cent stake in Northern Orion Explorations.

Walsh also said the company is in the market to buy a low-cost gold producer. Miramar may be among a handful of companies considering buying the Giant mine.

Miramar has "zeroed" in on three low-cost producing sites "which the company is now evaluating aggressively."

The three sites were not named, but Miramar said they generate positive cash flow at current gold price.

Miramar hopes to make an announcement in the near future.

As for Giant, interim receiver Price WaterhouseCoopers, in an update sent to CAW in Yellowknife, said potential purchasers of the Giant and Kemess mines are continuing with their due diligence and negotiations are ongoing, PwC said. PwC did not name the potential buyers.

"We are hopeful we will be in a position to provide further details within the next few weeks," PwC said in its Aug. 26 memo.

Marc Danis, CAW Local 2304 president, said the update bodes well for Giant.

But the news is not so good for the Pamour and Nighthawk mines in Ontario. Pamour and Nighthawk were Royal Oak's operations under its Timmins division.

In that same update, PwC said it has been unable to find a buyer for Pamour and Nighthawk. PwC is seeking court approval to "terminate" operations at Timmins.

Pamour and Nighthawk mine manager Paul Bedard told Yellowknifer Friday that the last of the workers got the news that morning.

It's going to hurt the town, he said.

Pamour and Nighthawk employ 267 people. Pamour started producing in 1936 and has generated over four million ounces of gold.

Bedard said production costs are high and grades low.

Pamour and Nighthawk's cash costs are about $300 US.

The mines' ore is running at .08 ounces per tonne, added Bedard.